A New Year, a New Start

You have that wish, that urge to branch out on your own, to be your own person, to take control of your destiny – but how, and where to begin?


You have that wish, that urge to branch out on your own, to be your own person, to take control of your destiny – but how, and where to begin? Words: Andrew Martin

The media is full of stories of doom, and certainly 2011 was not exactly a good year for many in business, or even those employed. 2012 will doubtless have its fair share of business and employee casualties too, but delve below the surface and there are lanterns of hope and optimism. Starting and running a business of any size has always been a consequence of a sound product or service, hard work and a generous sprinkling of good luck, and nothing has changed in this respect.

You need to be certain in your own mind that you have the qualities and enthusiasm to take this leap of faith; to be able to take the knocks as well as the potential rewards. Talk to trusted friends and family who will give you an honest opinion. Draft out what you consider to be your strengths and weaknesses, the opportunities and the threats. Then, if you still feel sufficiently confident to progress to the next stage, arrange a meeting with the small business team at the local bank branch. If this does not throw up any nasty surprises that you had not to date contemplated, visit a second bank, in the same way. The offerings and the rhetoric will likely be the same, but the relationship with the bank is very important, and you may find the bank staff more appreciative of your concept in one bank than the other.

If all agree so far that ‘a seed of opportunity’ exists, speak to a reputable accountant or two. Enquire about fees and support services, such as bookkeeping, payroll bureau, and the configuration of accounting software or bookkeeping records. Perhaps there are business angels or consultants that you, the bank or accountant know of that can work with you to encourage and guide.

If all is still favourable and you feel encouraged to continue, consider how you are going to fund the initial expenses while waiting for receipts to ‘flood’ in from your customers. Any savings may have already been taken into consideration, so perhaps an overdraft, bank loan, even factoring or invoice discounting of those early sales invoices. The latter two products enable you to draw down in cash a proportion of your sales invoices as they are issued, which is in effect re-paid as your customers settle their debts to you. However, for all these facilities, the usual and obvious requirements apply – experience, proven track record, energy, enthusiasm, sound business plan, and (the really big one) security. This is a big hurdle, but not necessarily insurmountable. You need to document your experience, your plans for marketing and advertising, the cash you have and how much more you need, by when and for how long. It is really important that this is both credible and properly presented. At the first attempt, it is not uncommon to be advised to reconsider your proposal, but do not be dismayed. Hear the advice and the reason, re-draft accordingly and re-present. The angels, accountants and consultants referred to above can help you, but be aware that this is likely to be an additional cost. Above all, make sure that if you do ask for help, it is from the right person.

Andrew Martin, Financial Management & Business Consultant (Taunton), http://www.andrewmartinconsulting.co.uk